FILNER ADDS LATE TWIST TO SALE OF SCHOOL LAND

Mayor interested in buying vacant Mission Beach site days before $18.5M bid review

MISSION BEACH 
The San Diego Unified School District’s effort to sell 2.23 acres of prime coastal real estate has taken yet another dramatic turn.

Mayor Bob Filner has swooped in at the 11th hour, announcing his interest in having the city of San Diego buy the old Mission Beach Elementary School.

The city’s sudden interest in the land that has sat all but vacant for decades comes just days before the school board is set to consider an $18.5 million offer from developers to purchase the property. The district put the old campus up for sale last year, accepting and then unexpectedly rejecting a $16.5 million bid for the parcel.

“The mayor has expressed interest in the property,” mayoral spokeswoman Irene McCormack confirmed Friday. “He was unaware that the city passed on an opportunity to make a bid on the property.”

Where the city would find the money — and whether the City Council would agree with the purchase — is unclear. San Diego faces a $38.6 million deficit in next year’s $1.2 billion operating fund. Filner proposed closing the gap in his budget with aid of increased tax revenues, one-time money and some modest cuts.

San Diego Unified is looking to generate some $50 million by selling surplus property to help close a projected $92 million deficit in next year’s $1.1 billion operating budget. Additional excess properties in the district have been targeted for sale and are expected to raise millions more.

Before the district puts any property on the open market, it must first offer it to public agencies. The Mission Beach campus sparked no interest from public agencies both times the district solicited bids.

School board President John Lee Evans said the city missed its opportunities to buy the land and that it would be irresponsible for the district to back away from a reliable bid just weeks before it must adopt a final budget.

“I just have serious doubts that anyone other than the bidder is going to come up with a check for $18.5 million before next Tuesday,” Evans said. “It’s just not realistic. We cannot cancel the sale on the idea that this other possibility that could take years to realize.”

Critics of San Diego Unified’s real estate sales plan include school board trustee Scott Barnett and some residents and members of various community boards in the Mission Beach area.

Several community board members met with Filner on April 30 to discuss the property and gauge the city’s interest in acquiring it. Many residents are desperate to stop development plans in an area that already faces traffic problems.

“We want to preserve this land for a use that benefits residents. We are so densely populated and the crime and congestion is terrible,” said Jennifer Tandy, who lives in Pacific Beach and chairs the district’s Mission Bay Cluster committee of parents in around the area. “The land has so much potential to be used for good.”

It is unclear what the city would do with the property. Residents would like some of the land set aside for a community park.

The old school sits just a block from Mission Bay and two blocks from the ocean.

City Councilman Kevin Faulconer has been involved in conversations about the city’s potential purchase of the old school, said his chief spokesman, Matt Awbrey.

“It’s clear that this is an important piece of property. Councilmember Faulconer believes it should be used to the maximum community benefit,” Awbrey said. “However, it is unclear how the city could afford this. It comes at a time when the city is close to getting its budget situation in order.”

Barnett is eager to help broker some kind of deal between the city and district. He is critical of San Diego Unified’s plans to use using one-time funds — such as land sales — to balance the budget and cover what he calls irresponsible spending habits.

Barnett has advocated for a property management plan that could help the district generate revenue from its vast real estate holdings. A potential scenario for Mission Beach that’s been discussed calls for a collaboration that would allow the city to invest $10 million toward buying the real estate, with the district maintaining an $8.5 million interest in the project that could serve the community and generate revenue for the district, Barnett said.

“I believe there is a way we can work with the city on this,” said Barnett, who was personally approached by Filner about the land Thursday night. “It’s for the community to decide exactly what we do. But we know what they don’t want. They don’t want condos.”

The school board meets Tuesday to consider the $18.5 million bid, the highest one made at an auction earlier this month. The offer came from a new partnership, McKellar-Ashbrook LLC in La Jolla. That offer bested the $16.5 million bid that was made just a year ago from San Francisco-based Carmel Partners LLC.

The first sale attempt was abandoned after then-trustee Shelia Jackson had a change of heart about the deal. Jackson left office and was succeeded by Marne Foster, who voted to put the property back on the market.

Unlike most board decisions, selling land requires at least four votes from the five-member board.

The developer rejected by the district during the first sale sent a representative to several board meetings to complain about the aborted deal, sometimes alluding to potential litigation. Since then, a law firm has filed a public records request with San Diego Unified asking for school board communications relating to the property.

The inquiry was sent May 2 from Lounsbery Ferguson Altona & Peak LLP and does not mention who the firm is representing.

Barnett believes the interest from lawyers could be a sign that litigation could hold up the sale of the Mission Beach campus.

San Diego Unified is taking on complicated real estate matters without the kind of expert it had hoped would lead the effort. Tina Vieceli, who was hired last year as the district’s first-ever real estate director, recently resigned.